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decree has been entered if the amount would be allowable
under local law.
Clearly, if a local court does not adjudicate the merits of a
claim, which typically would be the case in a nonadversarial
proceeding, the presumption that the decision of the local court on
allowability “will ordinarily be accepted” does not apply. Wolfsen
v. Smyth, 223 F.2d 111, 113-114 (9th Cir. 1955); First-Mechanics
Natl. Bank v. Commissioner, 117 F.2d 127, 129-130 (3d Cir. 1940),
affg. 40 B.T.A. 876 (1939); sec. 20.2053-1(b)(2), Estate Tax Regs.
To this end, in this case, a State court has not made an
independent review of the proposed allocation of the settlement of
the Eckell, Sparks malpractice case as set forth in the plaintiffs’
agreement. But the State courts did find that the Glovers lacked
standing with respect to all claims made against Eckell, Sparks.
The Glovers and the administrators pro tem. were not
adversaries with respect to the claims against Eckell, Sparks, the
dollar amount contained in the settlement agreement, or the
allocation memorialized in the agreement between the Glovers and
the administrators pro tem.
Decedent’s estate would face additional hurdles even if the
record did show that a State court had passed on the merits of the
claims and that the highest court of Pennsylvania would allow the
claims against the estate. Section 20.2053-1(b)(2), Estate Tax
Regs., is to be construed in harmony with section 2053(c)(1)(A),
which requires claims founded on a promise or agreement to be
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